What Minecraft is teaching your kids about money
Minecraft is such a hot property that Microsoft Corp recently forked out $2.5 billion for its maker
If your kids are chattering non-stop about things like emeralds, pickaxes and creepers, you may have a unique opportunity to turn a video game addiction into a life lesson about money.
Minecraft, a video game phenomenon with over 100 million users, is such a hot property that Microsoft Corp recently forked out $2.5 billion for its maker, Mojang AB.
Players build their own worlds via game systems, smartphones, tablets and computers using virtual Lego-like pieces. And as opposed to the shoot-'em-up video games that kids usually gravitate toward, this game teaches them about money.
It is “about barter, about value, about how to protect your stuff,” says Hank Mulvihill, a financial adviser in Richardson, Texas.
“Kids are learning about money on a lot of different levels in Minecraft,” says Joel Levin, co-founder of Manhattan-based TeacherGaming, a firm that works with educators to use video games as teaching tools.
“There are basic currencies, like emeralds that you dig up and can trade with villagers,” Levin explains. “There are exchange rates, because certain items are worth more than others. Then players have to think about whether to spend money right away, or save it and get something more rewarding later on. These are analogous to the financial decisions people are making in the real world all the time.”
And that is just if you are playing the game on your own. If you are online with multiple players, the financial issues become much more complex.
“At that point, players are setting up actual economies,” Levin says. “On a particular server, they may decide that diamonds are the currency of choice. Or some kids start playing the role of a bank, offering loans and charging interest.”
Levin is aware of instances where teachers introduce a rare item into the game that kids can't obtain on their own, and then watch them react to the scarcity. “It's supply and demand in action,” he says.
How to start from nothing
Of course, most parents only experience Minecraft by peering over their kids' shoulders and trying to figure out what the hell is going on.
So in case you were wondering, here are a few of Minecraft's key financial lessons:
When starting out in the world of Minecraft, “nobody tells you anything, no instructions,” says 19-year-old Harvey Mulvihill, son of Hank, who plays along with his two brothers. “You are a stranger in a strange land, and you have to figure out how to gain resources.”
Indeed, Minecraft is a so-called “sandbox” game, in which players roam a virtual world with very few limitations. In that way, it is a riff on the traditional American archetype of the Horatio Alger story - starting from nothing and somehow making a huge success of yourself.
Players have to gain skills and then leverage those skills to develop a better world for themselves.
How to protect what you have
As in life, very bad things happen all the time in Minecraft - death, robbery, physical attacks and disasters of all stripes.
As a result, players have to protect themselves against a number of terrible futures.
For example: travel light. “It is never a good idea to carry your valuables on your person,” advises 17-year-old Patrick Mulvihill. “Once you die your things are dropped on the spot of death. Valuables should be kept in chests in safe, well-lit places.”
But it is not just death players have to insure themselves against. That is because some people in this virtual world - known as “griefers,” according to Patrick - go online solely to steal and break other people's things.
How to make the right connections
Life is all about who you know, and Minecraft is no different. Connecting with the right people can make your virtual life a whole lot easier.
“If I was starting from scratch and didn't know any coding, I could be digging for emeralds forever,” says Dan Short, associate professor of environmental science at Robert Morris University in Pittsburgh, who has written an academic paper on Minecraft.
“But if you are on a server with other kids, the server owner can basically give you as many emeralds as you need. They're like little monarchs.”
The moral of the story? Your network counts, and you should develop it as much as possible.
How to monetize your skills
Once you become talented at something, you could find yourself in serious demand. Fifteen-year-old Sean Mulvihill plays with his buddies Jackson, Oscar and Wyatt. “Jackson is known for being the best builder, and others pay him to build them a house,” Sean says.
Meanwhile, Sean is seen as “by far, the best farmer,” he notes modestly. As a result, other players come to him with business propositions, like supplying him with seed, equipment and gold in order to tend their farms and divvy up the profits.
This principle of monetizing your Minecraft skills applies in the real world, too, notes Short. Some have become so talented at the game and charismatic with their audiences - with handles like TheBajanCanadian, Sky Does Minecraft and Lewis & Simon - that they run their own insanely popular channels on Google Inc's YouTube.
“They get followers on YouTube, they host games and then kids sometimes pay a premium for the chance to play with them and be in their videos,” Short says. “They must be making serious bank. That might be the biggest financial lesson of all.”